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How Can Fintech Help to Combat the Cost of Living Crisis?

With the cost of living crisis continuing to impact the global population, people are increasingly searching for helpful ways to manage their finances. 

Fintech was born out of the 2008 financial crisis and has since rescued and supported businesses through tough financial times, including the coronavirus pandemic. Fintech experts are now working on new solutions to help people during the current crisis 

What is Fintech?

Fintech comprises software and technology that is used to support banking and financial services. Fintech experts are constantly innovating to help improve existing financial systems, and access to them. However, fundamentally fintech is used to help companies and individuals better manage their financial operations. 

Challenger Banks

Since early 2022, challenger banks have seen a huge increase in consumer activity and have quickly become one of the most popular forms of financial technology. Over 40 independent challenger banks have sprung up in the last year. Popular challenger bank brands include N26, Revolut and Monzo, with combined users totalling 34 million!

Challenger banks boast many advantages when compared with traditional high street banks; this includes offering real-time updates on spending, creating budgeting trackers and providing general support and guidance.

However, it is clear that the full potential within this technology is not being maximised. A survey by GWI showed that 51% of users have transferred money to a friend or family member, whilst only 28% of people use a banking, investing or insurance app on a regular basis.

Opportunities Around the World

Millions around the world have been affected by the increase in food and energy prices, as well as the constant rise in inflation. According to the United Nations’ Food and Agriculture Organization, global food prices have increased by 65% since the start of the Covid-19 pandemic, and 12% in 2021 alone. Unfortunately, not everybody has access to helpful financial advice and services. 

The Middle East has the lowest percentage of banked internet users (69%) and consequently the smallest amount of people tracking their spending (19%). Investors are pouring money into these areas to help bring the unbanked population into the financial mainstream.  

With inflation driving economic anxiety, financial support is needed more than ever.

How Can Fintech Help?

Fintech offers intuitive and instantly accessible financial aid. By helping individuals gain control and visibility over their own financial situation, personal strategies can then be created.

For example, Nous, a banking app that has gained popularity in the last year offers a personalised dashboard in which you can create tailored budgeting solutions based on your spending habits and bills. 

The fintech industry has responded to the current crisis by offering a variety of helpful features, including financial education tools and spending trackers. Furthermore, many brands have scrapped fees to help support users.

From a business perspective, opportunity abounds in the world of fintech; the momentum behind this growing sector promises to create hundreds of new businesses and thousands of new career opportunities. 

Our Approach

Here at Morris Sinclair, we look forward to seeing the potential within the fintech sector unlocked over the months and years to come. We have no doubt that this technology will continue to bolster the world of business and personal finance.

As experts in the technology sector, we are well placed to help your fintech organisation grow with expert resource.With 40 years’ experience in the IT sector, our friendly and transparent team would be delighted to speak to you about your requirements. Get in touch with us today!

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